Asian Development Bank (ADB) has said it will launch the Asia Accelerated Solar Energy Development Fund with $2.25 billion as it targets solar power projects in countries including China, India, Pakistan, Uzbekistan and Thailand to add another 1,000 megawatts next year and 1,500MW in 2013.

“By providing an enabling environment for commercial lending and private investment in the solar energy market, we hope to encourage its rapid growth and bring solar energy nearer to grid parity – making solar energy competitive in price to conventional sources,” ADB President Haruhiko Kuroda said at a clean energy forum in Manila on Wednesday.

He said Asia needs to invest around $10 billion in the next few years to make solar power generation competitive with conventional energy sources and called for radical steps to fight climate change.

He said ADB wants Asia, home to about two-thirds of the world’s population, to add 3,000 megawatts of solar energy capacity by the end of 2013. Already this year, it has helped countries add 500 megawatts, doubling the region’s solar capacity. Fast-growing Asian economies rely heavily on fossil fuels. ADB has forecast Asia-Pacific imports of fossil fuels will more than double between 2005 and 2030, with oil accounting for more than 90 per cent of such imports.

“The total cost of this 3,000 MW is about $10 billion, of which we are planning to commit $2.25 billion,” S Chander, Principal Director at ADB’s Office of Information Systems and Technology, told reporters.

“Our job is to catalyse enough projects to increase volumes and to make sure that the manufacturers (of low-carbon technologies) have an incentive to invest in research and development,” Chander said.

ADB invested $1.76 billion in clean energy across 29 projects last year and said it is on track to meet a goal of $2 billion in clean energy investments annually by 2013. It plans to inject $60 million into three venture capital funds that will provide early-stage financing support for new climate technology products. It expects this initiative to leverage over $400 million in private sector investment.

Kuroda said Asia had a lot to lose from climate change and needed to act quickly to develop alternate energy source. “A big push is needed to accelerate this transition,” he said. “The climate fight will be won or lost by decisions made in this region.”